I was running through my colleague Brad Briggs’ recent look back at the silver crisis of the 1970s. He described a cautionary tale about investors chasing the commodity when its price was no longer connected to any sort of fundamental value. Needless to say, the silver bubble was eventually pricked: “With prices so high, people began selling all the silver they could get their hands on. Prices plummeted 50.0% in four days,” Briggs wrote. There is another metal that’s showing all the signs of a mania: copper. I don’t expect a sudden plunge as was… Read More
I was running through my colleague Brad Briggs’ recent look back at the silver crisis of the 1970s. He described a cautionary tale about investors chasing the commodity when its price was no longer connected to any sort of fundamental value. Needless to say, the silver bubble was eventually pricked: “With prices so high, people began selling all the silver they could get their hands on. Prices plummeted 50.0% in four days,” Briggs wrote. There is another metal that’s showing all the signs of a mania: copper. I don’t expect a sudden plunge as was the case with silver 30 years ago, but the price of this metal and of its key stocks are floating on a bed of complacency. This could all end soon thanks to a couple of occurrences that are happening offstage, but that may actually be advantageous in the short term. Copper prices have been steadily rebounding for the last two years as global demand perks up. The metal has many uses in construction, from plumbing to wiring to refrigeration coils. China, with its inexorable thirst for new building construction, has been a key driver for copper. This… Read More